Keep car or get an older one?

[footballmouse]

I have a 2012 car that I bought in 2014. I didn't have any problems paying the car loan and my mortgage until recently. Now I'm a month behind on both. I just can't seem to get caught up even with working 2 jobs.

I've been thinking of getting rid of my car either selling it to a dealer or just privately. I think it's hard to sell a car privately but I'd get more. I'm trying to get a loan from the bank for about $5000 and then buying a used car from an owner, not dealer. It would definately cut my monthly payment and the length of the loan. I'm just worried about getting a car with high mileage. When I traded my SUV in for this car, mine had over 200,000 miles on it and the engine was going to need to be replaced soon. I'm just afraid of something like this happening. I'm not even sure I'll get a loan since I'm behind on payments.

Any thoughts about high mileage cars? The ones I was finding for my target price were about 8 yrs old and had around 75,000 miles.

 

[Judique]

I don't worry so much about mileage as maintenance.

a 75K car would be a deal if it has no problems and has had proper maintenance.

Also accident free - or free from any really destructive accidents.

Also what models are you looking at? $5K for one type may be low or high.

Check KBB and the other price estimators as well.

Also how much did you pay for your 2012? Have you considered trying to get a refi loan for it to reduce your monthly cost?

 

[Marionnette]

I have a 2012 car that I bought in 2014. I didn't have any problems paying the car loan and my mortgage until recently. Now I'm a month behind on both. I just can't seem to get caught up even with working 2 jobs.

I've been thinking of getting rid of my car either selling it to a dealer or just privately. I think it's hard to sell a car privately but I'd get more. I'm trying to get a loan from the bank for about $5000 and then buying a used car from an owner, not dealer. It would definately cut my monthly payment and the length of the loan. I'm just worried about getting a car with high mileage. When I traded my SUV in for this car, mine had over 200,000 miles on it and the engine was going to need to be replaced soon. I'm just afraid of something like this happening. I'm not even sure I'll get a loan since I'm behind on payments.

Any thoughts about high mileage cars? The ones I was finding for my target price were about 8 yrs old and had around 75,000 miles.

I think that it's important to ask yourself why you were once able to meet those payments and now you cannot. What changed? Is it temporary or is this a cases of never being able to meet those bills again? And will selling this car and getting an older car (which will likely require more maintenance) actually free up enough cash to be able to make the payments on that car AND your mortgage? Or will you just be trading one problem for another while kicking the can down the road a bit?

 

[Alesia]

You really need to research the specific car you're looking at.

I had a 2009 Chevy Aveo that I sold last year because the warranty was almost up and there was no way I could afford the repair costs. In the last year that I had it, it was in the shop 3 times, and each time it cost over $2000. The car was well taken care of - oil changes every 3,000 miles, all of the routine scheduled maintenance, etc. It was 5 years old and had 72000 miles on it.

 

[mousehockey37]

In addition to what everyone else is saying, going to the bank and getting another loan isn't necessarily a good option. You're not able to make the payments you have now, why would you add another one?

A "new to you" older unfamiliar car will more than likely wind up costing you more than what you currently have now.

Are your rates good on the car and mortgage? Could you refinance one or both to get a better payment?

Without knowing what the 2nd job is, we're at a time where a bunch of places are hiring for seasonal help. Could you possibly land a higher paying 2nd job?

 

[Nayan]

Adding more debt isn't what you need right now and could possibly make your situation worse in the long run. How much debt do you have on the car and how much is it worth? If you sell it could you get enough to pay it off or would you be losing money there as well? Is there any way to cut other expenses, like eating out, coffees, entertainment, etc.? Do you have to drive to work or can you take a bus or bike? If you can't pay your bills it's time to take a step back and seriously look at your budget.

 

[tvguy]

Another vote for just refinancing the car you have.

 

[xlxo]

I have a 2012 car

To clarify... what is the make and model of this 2012 vehicle? Some vehicles very poor resale value.

 

[supersnoop]

How much equity do you have in your current car? Will you have to come up with some cash just to sell it? Or will you get some money out of it to pay for the next car?

My recommendation is to find a cheap car that you can pay cash for. So, hopefully you'll get a little bit out of the current car when you sell it, and you can go find a $1,500 car and pay cash. Then save the payment so you can buy another car when this one breaks down.

Any purchase is going to have transaction costs, the old "tax, title, and license." Financing only adds to the cost. You'll come out ahead if you can squeeze a year or so out of a beater.

 

[pfalcioni]

I agree with Supersnoop, you'll need to sit down and do all the math. Research what your current car is worth on the private market in your area by looking for listings of similar models in Craigslist, Auto Trader, and Ebay. Make sure these are actual private sellers and not dealers.

Next, winnow down your purchase options by checking Consumer Reports for long-term reliability. Generally Honda, Acura, Toyota and some higher-end Nissan models will have the best long-term reliability for the lowest cost (over 100k miles) with a few caveats. There are certain things that need to be replaced at specific intervals that can cost you a lot - things like timing belts that need replacement every 8,000 or 10,000 miles and that can cost upwards of $600 to have replaced. Getting a car with a timing chain rather than a belt will remove this cost.

Also take a hard look at how you drive your car. Do you have a really long commute every day? Do you have extreme conditions like very hot summers or lots of snow in the winter that require the car to have certain attributes (air conditioning/front or all-wheel drive)? This will further winnow down your choices. Make a list of the cars that you've found that have good long-term reliability and are within your price range.

Once you've done this you'll have a decent idea about the selling price of your old vehicle, and the purchase price of the new vehicle (including transfer costs). You'll also know the payoff amount on your current loan. Next, you'll need to find out what your monthly payments would be on the new loan. My guess is that unless you are currently paying for a car that cost you $30K, and will be buying a car that costs you under $10k, the numbers won't work out in your favor enough to make the change worth the potential problems.

Finally, look at the possibility of using public transportation. If this is even a minor possibility in your area, take a long hard look at making it work. You might even look at how much you're currently paying per month for car ownership versus public transportation/uber rides/renting a car when you need one.

If there's no way to make public transportation work and you're not going to save by purchasing a cheaper car, what about getting a renter?

 

[mousehockey37]

Finally, look at the possibility of using public transportation. If this is even a minor possibility in your area, take a long hard look at making it work. You might even look at how much you're currently paying per month for car ownership versus public transportation/uber rides/renting a car when you need one.

If there's no way to make public transportation work and you're not going to save by purchasing a cheaper car, what about getting a renter?

Where I work, they've had several pushes in recent months for carpooling as well. Chipping in a couple bucks for gas or having others chip in to help you when it's your turn to drive, will cut down on miles on your car, and save you money.

 

[tvguy]

To clarify... what is the make and model of this 2012 vehicle? Some vehicles very poor resale value.

Another issue, with a car this new you have already taken the biggest depreciation hit. Depreciation will slow now, but by getting rid of the car this soon, you are going to have to eat that depreciation. If you keep it, you can spread the depreciation over more years.

 

[xlxo]

Also look at where you drive.... If your commute has lots of red lights and/or high congestion... research an electric or a hybrid. I just got myself a Prius V to replace my old V8. I'm saving 4 to 5 times the gas.... enough to cover my monthly payments! You do need to change your driving habits to get the best fuel economy.

Electric vehicles are great if your electricity hydro comes from water turbines... nuclear or coal generated electricity may not yield the same benefits.

I noticed where I live, Toyota hybrids offer great resale value after a few years.... not so for other makes.

 

[tvguy]

Where I work, they've had several pushes in recent months for carpooling as well. Chipping in a couple bucks for gas or having others chip in to help you when it's your turn to drive, will cut down on miles on your car, and save you money.

My past employer moved our business across the river to a new city. That new city had a Federal grant to research mass transit and carpooling options. Program director could not believe that out of 120 employees, none could carpool and very few could use public transi

Also look at where you drive.... If your commute has lots of red lights and/or high congestion... research an electric or a hybrid. I just got myself a Prius V to replace my old V8. I'm saving 4 to 5 times the gas.... enough to cover my monthly payments! You do need to change your driving habits to get the best fuel economy.

Electric vehicles are great if your electricity hydro comes from water turbines... nuclear or coal generated electricity may not yield the same benefits.

I noticed where I live, Toyota hybrids offer great resale value after a few years.... not so for other makes.

Well, a hybrid maybe a good choice now, but the resale value on them has never been worse. Gas prices are down and sales of new hybrids are down 30%, and values of used hybrids are down because of that. I've never seen a new Prius below $20,000 before this year.
I don't play the resale game, my 12, 15 and 28 year old cars are proof of that.

 

[Judique]

Where I work, they've had several pushes in recent months for carpooling as well. Chipping in a couple bucks for gas or having others chip in to help you when it's your turn to drive, will cut down on miles on your car, and save you money.

Carpooling or using mass transit sounds like a solution. But - reality for my son was mass transit cost $16 per day or $320 for 4 weeks of 5 days each. Car payment was $202, insurance $75 a month, gas about $80 a month. So for very little extra money he could have a car 24/7.

 

[mousehockey37]

Carpooling or using mass transit sounds like a solution. But - reality for my son was mass transit cost $16 per day or $320 for 4 weeks of 5 days each. Car payment was $202, insurance $75 a month, gas about $80 a month. So for very little extra money he could have a car 24/7.

Then he must be in one expensive area. A monthly pass for my area is $49 for the general region.

 

[mousehockey37]

My past employer moved our business across the river to a new city. That new city had a Federal grant to research mass transit and carpooling options. Program director could not believe that out of 120 employees, none could carpool and very few could use public transit

I can believe it. In today's world people drive from anywhere to anywhere to work because you have to go where the money is.

 

[Gr8t Fan]

Carpooling or using mass transit sounds like a solution. But - reality for my son was mass transit cost $16 per day or $320 for 4 weeks of 5 days each. Car payment was $202, insurance $75 a month, gas about $80 a month. So for very little extra money he could have a car 24/7.

WOW!!!! A monthly pass in metro Chicago costs $100 and gets me everywhere I need to go.

 

[xlxo]

Well, a hybrid maybe a good choice now, but the resale value on them has never been worse. Gas prices are down and sales of new hybrids are down 30%, and values of used hybrids are down because of that. I've never seen a new Prius below $20,000 before this year.

Yes...I too hear that SUV's are popular again. However, it also means I could finally afford buying a new hybrid at these lower prices...

In addition to gas prices being down.... competition...

• there are more hybrids and electric vehicles to choose from in addition to the Prius. Even Toyota has spread the hybrid technology to Camry, RAV and Lexus products. However if you want cargo space without the bulk of a large SUV... the Prius V is hard to beat.
• the budget Tesla's are creating lots of excitement that will force hybrid prices down further in the coming years. However without a motor to generate electricity...
  • do you have convenient outlets in older apartments and buildings?
  • is there enough outlets in malls?
  • have you heard about "charge rage"? This is where drivers will unplug each other's vehicles to charge their own. Leaf owners vs volts as an example.
  • what happens when electricity prices rise?

 

[tvguy]

Yes...I too hear that SUV's are popular again. However, it also means I could finally afford buying a new hybrid at these lower prices...

In addition to gas prices being down.... competition...

• there are more hybrids and electric vehicles to choose from in addition to the Prius. Even Toyota has spread the hybrid technology to Camry, RAV and Lexus products. However if you want cargo space without the bulk of a large SUV... the Prius V is hard to beat.
• the budget Tesla's are creating lots of excitement that will force hybrid prices down further in the coming years. However without a motor to generate electricity...
  • do you have convenient outlets in older apartments and buildings?
  • is there enough outlets in malls?
  • have you heard about "charge rage"? This is where drivers will unplug each other's vehicles to charge their own. Leaf owners vs volts as an example.
  • what happens when electricity prices rise?

Honda and Toyota are both discontinuing a few hybrid models for 2016, so there will a slightly smaller field. My company jumped on the hybrid bandwagon in 2008, added 4 to our fleet. Mileage just wasn't better enough to justify the added purchase price, and we've had to replace some sort of modules on them that are over $1,000. So, they are socially responsible vehicles, but at a price.